Hampton v. Barclays Bank Delaware

          MEMORANDUM AND ORDER

          Daniel D. Crabtree, United States District Judge

         Pro se plaintiff^[1] Anthony J. Hampton brings this action against eight named defendants, alleging violations of the Fair Credit Reporting Act (“FCRA”), 15 U.S.C § 1681-1681x, and the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227. This matter comes before the court on several motions filed by some of the defendants: (1) defendant Discover Bank's Motions to Dismiss (Docs. 56 & 75), (2) defendant loanDepot.com LLC's Motion to Dismiss (Doc. 58), (3) defendant Equifax Information Services, LLC and Equifax Inc.'s Motions to Dismiss (Docs. 61 & 83), (4) defendant Marketplace Loan Grantor Trust's Motion to Dismiss (Doc. 78), and (5) defendant Trans Union LLC's Motion for Judgment on the Pleadings (Doc. 107).

         For reasons explained below, the court denies defendant Equifax Information Services, LLC and Equifax Inc.'s Motions to Dismiss. Also, the court denies the remaining motions but without prejudice to defendants reasserting their dismissal arguments directed at an amended pleading. Also, the court grants plaintiff leave to file a Second Amended Complaint-one that cures the pleading defects that the court identifies below. Plaintiff must file his Second Amended Complaint within 20 days of the date of this Order.

         I. Factual Background

         The following facts come from plaintiff's First Amended Complaint (Doc. 48).^[2] The court accepts these facts as true and views them in the light most favorable to plaintiff. S.E.C. v. Shields, 744 F.3d 633, 640 (10th Cir. 2014) (“We accept as true all well-pleaded factual allegations in the complaint and view them in the light most favorable to the [plaintiffs].” (citation and internal quotation marks omitted)).

         On March 20, 2018, plaintiff sent a demand to defendants loanDepot.com (“LD”) and Marketplace Loan Grantor Trust, Series 2016-LD1 (“Marketplace”). Plaintiff demanded that defendants LD and Marketplace not call him. But, between March 21 through May 22, 2018, plaintiff received 71 calls on his cell phone from Marketplace, using an automatic telephone dialing system or artificial or prerecorded voices. Without plaintiff's permission, Marketplace called plaintiff and left recorded messages. Also, between March 24 and April 19, 2018, plaintiff received 10 calls on his cell phone from LD and Marketplace, using an automatic telephone dialing system or artificial or prerecorded voices.

         On March 19, 2018, plaintiff sent defendant Discover Bank (“Discover”) a “Notice of Dispute.” This Notice demanded validation of an alleged account (0773). On March 20, 2018, plaintiff sent defendant LD a “Notice of Dispute. This Notice demanded validation of an alleged account (9589). On March 21, 2018, plaintiff sent defendant Barclays Bank Delaware (“Barclays”) a “Notice of Dispute.” This Notice demanded validation of an alleged account (6198).

         On March 20, 2018, plaintiff sent defendants Equifax, Inc. (“Equifax”), Experian Information Solutions, Inc. (“Experian”), and Trans Union, LLC (“Trans Union”) Notices of Disputes of the Discover, LD, and Barclays's accounts. Plaintiff disputes the accuracy of the information that Discover, LD, and Barclays have reported to the consumer reporting agencies (“CRAs”). Discover, LD, and Barclays never have provided notice of the disputed matters to the CRAs.

         Plaintiff never has received “authentic evidence regarding the validity of the debt.” Doc. 48 at 8 (Am. Compl. ¶ 28). The CRAs contacted Barclays, Discover, and LD, and asked for a reinvestigation of the alleged debt. Equifax, Experian, and Trans Union have failed to report plaintiff's dispute about the alleged debts.

         Based on these alleged facts, plaintiff asserts that defendants LD and Marketplace have violated the TCPA (Counts I and II). Also, plaintiff asserts that defendants Barclays, Discover, LD, Equifax, Experian, and Trans Union have violated one or more provisions of the FCRA (Counts III, IV, V, & VI).

         II. Legal Standard

         Some defendants seek dismissal of plaintiff's Complaint under Fed.R.Civ.P. 12(b)(1) for lack of subject matter jurisdiction because, they contend, the Complaint fails to allege that plaintiff sustained a concrete injury sufficient to confer standing. Other defendants ask the court to dismiss plaintiff's Complaint under Fed.R.Civ.P. 12(b)(6) because, they contend, it fails to state a plausible claim for relief against them. The court recites the legal standard for a Rule 12(b)(1) dismissal for lack of subject matter jurisdiction and a Rule 12(b)(6) dismissal for failure to state a claim in the following subsections.

         A. Motion to Dismiss for Lack of Subject Matter Jurisdiction

         “Federal courts are courts of limited jurisdiction and, as such, must have a statutory basis to exercise jurisdiction.” Montoya v. Chao, 296 F.3d 952, 955 (10th Cir. 2002) (citation omitted). Federal district courts have original jurisdiction over all civil actions arising under the constitution, laws, or treaties of the United States or where diversity of citizenship exists. 28 U.S.C. §§ 1331-32. “A court lacking jurisdiction cannot render judgment but must dismiss the cause at any stage of the proceedings in which it becomes apparent that jurisdiction is lacking.” Basso v. Utah Power & Light Co., 495 F.2d 906, 909 (10th Cir. 1974) (citation omitted). Since federal courts are courts of limited jurisdiction, the party invoking federal jurisdiction bears the burden to prove it exists. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994).

         Generally, a motion to dismiss for lack of subject matter jurisdiction under Fed.R.Civ.P. 12(b)(1) takes one of two forms: a facial attack or a factual attack. Holt v. United States, 46 F.3d 1000, 1002 (10th Cir. 1995). “First, a facial attack on the complaint's allegations [of] subject matter jurisdiction questions the sufficiency of the complaint. In reviewing a facial attack on the complaint, a district court must accept the allegations in the complaint as true.” Id. (citing Ohio Nat'l Life Ins. Co. v. United States, 922 F.2d 320, 325 (6th Cir. 1990)).

         “Second, a party may go beyond allegations contained in the complaint and challenge the facts upon which subject matter jurisdiction depends.” Id. at 1003. “When reviewing a factual attack on subject matter jurisdiction, a district court may not presume the truthfulness of the complaint's factual allegations.” Id. “A court has wide discretion to allow affidavits, other documents, and [to conduct] a limited evidentiary hearing to resolve disputed jurisdictional facts under Rule 12(b)(1).” Id. (internal citations omitted); Los Alamos Study Grp. v. United States Dep't of Energy, 692 F.3d 1057, 1063-64 (10th Cir. 2012).

         B. Motion to Dismiss for Failure to State a Claim

         Fed. R. Civ. P. 8(a)(2) provides that a complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Although this Rule “does not require ‘detailed factual allegations, '” it demands more than “[a] pleading that offers ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action'” which, as the Supreme Court explained, “‘will not do.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

         When considering a motion to dismiss under Fed.R.Civ.P. 12(b)(6), the court must assume that the factual allegations in the complaint are true. Id. (citing Twombly, 550 U.S. at 555). But the court is “‘not bound to accept as true a legal conclusion couched as a factual allegation.'” Id. (quoting Twombly, 550 U.S. at 555). “‘Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice'” to state a claim for relief. Bixler v. Foster, 596 F.3d 751, 756 (10th Cir. 2010) (quoting Iqbal, 556 U.S. at 678). Also, the complaint's “[f]actual allegations must be enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555 (citations omitted).

         For a complaint to survive a motion to dismiss under Rule 12(b)(6), the pleading “must contain sufficient factual matter, accepted as true, to ‘state a claim for relief that is plausible on its face.'” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). “The plausibility standard is not akin to a ‘probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. (quoting Twombly, 550 U.S. at 556); see also Christy Sports, LLC v. Deer Valley Resort Co., Ltd., 555 F.3d 1188, 1192 (10th Cir. 2009) (“The question is whether, if the allegations are true, it is plausible and not merely possible that the plaintiff is entitled to relief under the relevant law.” (citation omitted)).

         III. Defendant Discover Bank's Motions to Dismiss (Docs. 56 & 75)

         Plaintiff's Complaint asserts one claim against defendant Discover, claiming Discover violated the FCRA under 15 U.S.C. § 1681 (Count III). Congress “enacted [the] FCRA in 1970 to ensure fair and accurate credit reporting, promote efficiency in the banking system, and protect consumer privacy.” Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 52 (2007). Among other things, the FCRA imposes various obligations on “furnishers” who provide financial and credit information to CRAs. See Chiang v. Verizon New England Inc., 595 F.3d 26, 35 (1st Cir. 2010); 15 U.S.C. § 1681s-2. Discover argues that plaintiff's FCRA claim against it fails to state a claim for two reasons.

         First, Discover asserts that plaintiff cannot assert a claim under the FCRA based on his allegations that Discover provided inaccurate information to CRAs. Discover correctly argues that the FCRA's requirement in § 1681s-2(a) that a furnisher provide accurate information to CRAs does not create a private cause of action for a consumer to assert against a furnisher of credit information. See Chiang, 595 F.3d at 35 (noting that only § 1681s-2(b), but not § 1681s-2(a), confers a private right of action); see also Tilley v. Global Payments, Inc., 603 F.Supp.2d 1314, 1322 (D. Kan. 2009) (“Significantly, Congress did not create a private right of action for violations of § 1681s-2(a). These duties can only be enforced by governmental agencies and officials.”). Thus, none of plaintiff's allegations that Discover provided inaccurate information to CRAs states a claim under the FCRA.

         Second, Discover recognizes that plaintiff may assert a private right of action for violating the FCRA's § 1681s-2(b) requirements. Chiang, 595 F.3d at 36; Tilley, 603 F.Supp.2d at 1322. But, Discover asserts, plaintiff's Complaint fails to allege facts capable of supporting a plausible inference that Discover violated this section of the FCRA.

         More specifically, § 1681s-2(b)(1) of the FCRA imposes certain requirements on a furnisher of information “who has received notice of a dispute from a CRA.” Llewellyn v. Allstate Home Loans, Inc., 711 F.3d 1173, 1178 (10th Cir. 2013) (emphasis added). This provision requires the furnisher to:

(1) investigate the disputed information; (2) review all relevant information provided by the CRA; (3) report the results of the investigation to the CRA; (4) report the results of the investigation to all other CRAs if the investigation reveals that the information is incomplete or inaccurate; and (5) modify, delete, or permanently block the reporting of ...